welcome to the interview she. has always been part. of the world's leading manufacturers but for political and economic reasons planes. now.

so what do. the world. will discuss with the man at the helm of the. president. had been making superior fighter jets now the project that is expected to conquer the international civil aviation market last spring. one hundred. inexplicably crashed in indonesia. accident in customers remained loyal to the plane see continued. interest. as he believes in the super jet and the future. russian civil.

mr ferguson and welcome to the show. this is your second time with spotlight and i'd like to start with an issue that didn't get a mention last time the united aircraft corporation doesn't only produce civil aircraft but also military jets. civil aircraft have invited questions as to their ability russia has been and still is one of the world's leading manufacturers of military aircraft is that correct this issue doesn't get a lot of attention and i can confirm that russia has a strong staining in the international market for military aircraft. and the two large families of jets we produce. eggs and this is a horse which complement each other. so we can offer our customers fourth generation jets as well as generation advanced front line aircraft

. aircraft have been the backbone of russian arms exports for the past fifteen years in terms of sales volumes. but. if you. knew so little publicity actually means always good in the industry. i would say so . we've seen cysteine development in the past. and in recent years it's been reinforced with sizable defense contracts from the government to the. russian air force. is it true that the real cutting edge jets are not available for export they are still considered secret or does it only concern specific equipment options experts probably see his changed. all the hardware we produce on the international market of course there are certain limitations. to specific options other. that we have served in respect of the russian ministry of defense. but we're

pretty open for our international partners. to give you an idea of just how open we are working. project the fifth generation jet. indian partners. today regrettably far from being a world leader in civil aircraft manufacturing. as our biggest limitation. needs to do to reclaim its market share and its reputation as a world class manufacturer. union didn't market its civil aircraft a lot but they were seen as reliable. take a lot of hard work. capacity. and used to occupy twenty five percent of the global market for civil aircraft. ensured stable demand for the

products aircraft industry had to offer. today aircraft market. at about three percent of the global market so if we were to. domestic demand we wouldn't be able to remain competitive internationally. that's why we need to cater to an international market and that would require us to embrace new best practices with regard to design engineering production. and even financial arrangements. so aircraft distributed in the global market today are provided lease that means. only manufacture an aircraft but also. for the customer. brings us to a whole list of challenges we need to resolve.

if i'm not mistaken your united aircraft corporation was established in two thousand and six and that means you've been in the market for six years now and i remember when the company was originally introduced trumpeted in the press as an important breakthrough development that years later you're still telling me how much work needs to be done about the progress in the past six years have you been merely gaining traction or have you managed to create any essential capacities. we have actually a lot over the last six years on the other hand six years is not enough time to address all the deficiencies that had been piling up for two decades for reference we've doubled our production output in the past five years bending it by twenty percent on average each year. but. in the meantime. fifty four aircraft supply to the market in two thousand and seven. two hundred ten

aircraft produced last year. in the global market. in international most of our sales are still military aircraft have the capacity to make an impressive appearance in the civil aircraft market. as c.e.o. of the company could you tell us now if the industry into a comprehensive corporation was the right thing to do with other words has your consulate aided business proved efficient. and i'm convinced that if we are to compete in the global market we need to concentrate all of our resources in a single entity. so you think it was right to do so. you can be competitive in the global markets if you scatter your potential. if we look at europe. and. the integrated organization that brings together all of europe's major assets related to aircraft. in

a factory. in the united states. with mcdonnell douglas. integrated business which doesn't only command american industrial assets but also collaborates closely with me japanese in industries. production one to that end and that's exactly what we did six years ago. many describe you as a state run company. your primary source of finance the government private investors. who. are present stage we need a lot of investment and considering our initial liabilities which originate from the large debts the cumulated constituent companies the corporations which wouldn't have been able to settle its accounts without some serious support from the government. financing framework is based on

a combination of substantial government funding. reinvested profits and money from our corporate partners we finance our military aircraft projects with earnings. which we don't earn enough to sustain both civil and military production so that's where the government comes in. finally we actively encourage our partners to invest in our civil aircraft projects for example we're promoting our project project in collaboration with. a subsidiary of the finmeccanica group will be jesting this framework in the future as we increase our production volumes are planning to gradually reduce the public funding and expand the share of our own revenues from successful projects in investing in our development. i ask you how much the government spends on your corporation every year.

this is a rather complicated question it's hard to give a simple answer for instance the government tends to place orders with us for military aircraft and other hardware is that the government spending money on us or is it working for the government or will that money be considered public funding should. but the government hasn't made any money on you so far has it in fact the government has a stable income for military aircraft exports. does it. one of its most profitable industries in that segment. in the meantime however the last are competitive positions in areas. in commercial. near proceeds from military exports business development areas so how much money does the government spend it here to appeal those funding gaps the government doesn't feel any specific gaps it simply invests in a number of programs we expect to close this year with

a total of two hundred billion rubles in revenues and i think you will maintain losses at about five percent of that but if you. so your losses add up to five percent. that isn't march. look at the corporation's earnings before interest and taxes rate of return is ten percent so we do generate operating profit . but at the same time we'd be a considerable financial liabilities which are out of balance and that's what gives us this amount of losses. i see here i'm no expert in economics but considering your dynamics and such a loss rate you should be able to break even in two or three years right we aim to reach the breakeven point within two or three years. but will carry on in just a minute. i'm talking to me sound president of the united air craft corp spotlight

will be back shortly after a break so stay with us we'll continue this interview in less than a minute. wealthy british style.

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i. welcome back to spotlight i'm older now and just a reminder that my guest on the show today is sound president of the united aircraft corporation of which mr progress on super jack one hundred is

a cutting edge russian aircraft gotten a lot of publicity there he goes there is russia's being for competing in the global market only as far as the short whole segment is concerned do you have any medium or long range aircraft in the making some say that's a market segment where russia doesn't stand a chance for now when the good of those aircraft production is a fast growing market we see opportunities today for marketing new aircraft in both the medium and the long haul segments. some of you mean russian aircraft both russian and foreign made there is an assessment that we actually share with the world's leading companies in airbus the d two powerhouses. global market won't remain unchallenged forever. the chinese are also investing heavily in

developing their civil aircraft industry as for superjet one hundred it's actually a crossover between short haul aircraft and the regional jet. in terms of cabin comfort it belongs with short whole airliners like boeing seven three seven airbus a three twenty other than with jets like embraer or bombardier. technologies applied for superjet really reaches beyond the scope of a regional jet. as for larger aircraft we are currently working on a big project titled m s twenty one which should give us a product line of passenger aircraft ranging between one hundred fifty in two hundred seats. that should become our bid segment where most successful products in the industry are concentrated in those who are. but will boeing airbus lets you get a foothold in that market because those are mammoth competitors and they've been

consolidating and expanding production too. is growing so rapidly specially in southeast asia the emerging airline companies just can't afford to sit around in a wait for five or six years before they can buy aircraft from the world's leading manufacturers the kind of waiting list they have struggling to keep up with demand even with their enormous output capacity running at three hundred fifty four hundred aircraft per annum and is increasing pace into so i think there is an opportunity for a third contender to enter the market and we have a chance to be that third contender we would have to be china to it. we don't just compete with china we're also exploring ways to cooperate and i believe we have some competitive advantages to get there ahead of china. we have a strong background in engineering research in training but. china will cooperate as long as you stay ahead but once they feel your behind they

will lose interest. but agree it's going to go back to the super jet one hundred projects. the plane is up and running it's in the spotlight so here's a question to you as the project managers since as i understand you are not the engineer who designed it i am an engineer. brainchild as a manager do you think this project has been a success i would be that certain as to whose brainchild it is. but it's you who sell it so i think generally this project has been a success we have managed to do a really great job in such a short time starting from scratch and working your way up to getting it certified in europe not only in russia putting it in operation and promoting it on the world market this is where you are quite satisfied with the project because some of the. aviation projects take a long time to reach maturity so i would say i am happy only in

a while so far i can see that the project is developing successfully we still need another eighteen to twenty four months the number of aircraft. to set up a maintenance service and sort out other issues as well. one of the problems when the reasons why i missed the. probably is that one of russia's jets one hundred crushed while on a demonstration flight. the details are reported by spotlights in the media. in. the six nations advertising two of the. plane disappeared from radar shortly after takeoff on the ninth of may two in a demonstration flight the next day the plane. wreckage was discovered on the side of the dormant mount salak will can hold over forty five people died

a number of factors were considered as a possible cause of the crash. another could be human error the pilot reported it dropped to six thousand feet during the flight a violation of the minimum multitude in the mountainous areas where peaks rise to eleven thousand feet much was said of the mystical aspect. has been dubbed an airplane graveyard of the last ten years seven planes have crashed before the accident one hundred seventy orders have been placed for the jet around the world right after the crash there was speculation about the loss of potential buyers however there have been cases in that the asian when the questioning a demonstration to a did not influence the commercial success of a plane. crash in indonesia a fact the sales and the reputation of the corporation's through so i mean it's amazing how often such accidents are much talked about but don't have negative

consequences. first of all. the reliable information we have in our preliminary analysis indicates the aircraft was in good order and the cause of the crash was human error. but i would not like to jump ahead of the official investigation but i guess its conclusions. obviously the crash wasn't good for the promotion but if you look at the root cause analysis this is difficult issued by the european aviation safety agency earlier this year and the plane's flight record so far is the old proof that the aircraft is absolutely consistent with all the existing requirements. besides our major customers every year from their intent to operate the aircraft well those who among them the indonesian. and mexican companies. will get their first order this year or laos airlines with this year will also send super jets

toward joint venture in venus' italy where they will be customized forwarded to a customers in mexico early next year. despite the crash the project. is still there and the project complies with all the requirements of the market even its. geographic scope of sales is indeed impressive but there was an issue the media reported on last month when our mamiya an armenian airline who had been the first to place an order for super jet announced that it was i quote declining for the purchase and having bad. the one jet that had already been supplied complains were that spare parts for the jet were too expensive price three or four times above boeing's rates and that its monthly maximum flying time was too short a mere one hundred fifty hours

a month compared to boeing's three hundred hours only there were also claims that super jets angels are to have you and need further improvement could you comment on that is it true that very first customer moreover a company from a country that's very friendly toward russia has given up on superjet. we all know the media are especially fond of covering bad news. and you know i'm just quoting a story from the press right now life is much more complex. he did a total of about one hundred flights on superjet with total flight time running it twenty four hundred flight hour was within a year and generally the aircraft was an operation it was successful. two hundred flight hours a month that's right but i believe it is quite a good result for an early stage of operation. for the kind of route network. operates. we do have a commercial dispute. but we're contributing effort and both sides. should accept

a bill solution. so i expect to see progress in this negotiation rather soon. speculation on our relations with that we've seen in the media will become irrelevant. i think be able to come to agreements with. naturally tend to have higher expectations regarding the product which becomes an issue in early stages of a project. we do our best there demands as much as possible but still. any project. stage by stage. appreciate the feedback. and. should contribute to our improvement. so there is a chance that next time off to armenia it will be a superjet. i would say this is quite possible. there is one thing i still cannot

understand after listening carefully to what you've said the government has invested so much money and attention in promoting aircraft manufacturing in russia and it's established this massive industrial corporation and yet you'll barely find a russian jet in operation in the russian market at least from where i'm standing seems that all russian companies only operate boeing and airbus products why is that. airline passenger traffic in russia shrink dramatically poling the collapse of the soviet union. all of our airlines for operating abundant fleet of aircraft being confronted with traffic volumes. for the next ten years no one in russia was looking to buy new aircraft. except for small batch purchases only but on which naturally this wasn't very encouraging as far as business development in the industry is concerned in addition boom there were substantial

difficulties in marketing russian aircraft internationally. ability was restored in russia limited demand for aircraft would increase char pieces because we couldn't instantly provide for its little manufacturing in the previous decade or so but no we are gearing up to make sure that is significant share of the russian market should be provided with a russian made aircraft superjet one hundred twenty one. or corporation for in the russian government have also been exploring ways to promote russian made aircraft in the russian market in storage and i believe that she will meet again in a few years time we'll be looking at a completely different market dynamics overseas with large numbers of russian made jets by russian companies thank you you have promised to tell us more so i'll be looking forward to our next meeting with thank you very much for being with us and just reminded that my guest today was. president of the united aircraft compression

and that's it for now from all of us here spotlight will be back with more christiane comments on what's going on in and outside russia until then stay on r.t. and take your. invented by the same still be an orthopedic as our friend the nine hundred fifty s. these frames for initially used to treat fractures in deformities by cutting bones and slowly pulling them apart and therefore stimulating tissue regeneration elizabeth was able to reshape arms and legs and people who thought they were. full life about a third of patients. are now days seeking series three. most of them

are men and most are not what you would call vertically challenged trusting no because operated on many of them it usually comes down to man's pride first patient returned to us with a leg length quest to meet his fifteen centimeters to. surgery because panos tool than him we like to say that we need to break their legs in order to fix their head like lengthening surgeries a band in many countries and even the will out there pressure expensive in russia the entire course costs eleven thousand dollars about one tenth of the similar package in the united states financial considerations for one of the reasons they brought this washington state to western siberia main motive for the surgery had to do with how he fared. in america is one seventy five i was one sixty seven or one sixty. eight centimeters would have brought me right to average

for women height ported girl can be sure it's not a big guy it's like expect to be taller just before the operation most this matter russian girl who found he's a regional hide quite in dealing yet he still went ahead with the surgery adding seven more centimeters to the self-confidence she took. so now it's with. what a compliment for somebody who's used to falling short of his own expectations.